Malcolm Chumbley, head of land and development at Cluttons believes it’s time for the UK Government to explain how it intends to plug the ever-growing housing gap
The Government recently published its Planning Statement, complete with its ‘presumption in favour of sustainable development.’ This is a key part of the coalition Government’s review of the planning system, and will form an important part of proposals, which have been designed to encourage development, while maintaining vital environmental protections.
The wording of the draft is vague and has already prompted calls for clarification on how the new planning system will work in practice. How can we guarantee that the new homes, energy and transport links this country so desperately needs will be delivered when we know developers are regularly hindered by a planning system which can be slow, costly and unpredictable?
The time for action has arrived, for the sake of communities across the UK as well as the developers who are keen to find a way to deliver the Government’s ambition to provide up to 150,000 new homes in the UK over the next four years.
At the moment, it’s not clear how the goal will be achieved, especially as grant aid will no longer be available for affordable housing within developments under the new regime. This will render many proposed schemes unviable, as, according to our calculations, the residual cost for each affordable dwelling without grant support is likely to be in excess of £40,000 on an average development site in South East England.
Funding options are few and far between, especially for medium-sized and smaller developers, who are seeing their profits sink lower all the time. Banks are unwilling to lend on the vast majority of schemes and despite the Government’s suggestion that considerable tracts of public sector land will be released for development, even nationwide house builders won’t be hooked if there is no positive land value and little profit for their shareholders.
We also have to consider how we can support the communities that will be taking an active part in kick-starting development in their own areas. The new planning framework is centred around localism, putting power with the people. But just how quickly can communities and Councils create local plans that have a chance of survival? Given that we are unclear on how we can encourage land to be brought forward for development, it is difficult to imagine how we can secure the UK’s future of sustainable and sufficient homes.
Given the current economic climate and the resulting pressure on our already stressed property market, it is now critical for our Government to consider its best course of action and explain how we can plug the UK’s crippling housing deficit.